Consumers Int'l v. Sysco Corp.
Arizona Court of Appeals
951 P.2d 897 (Ariz. 1997)
Sysco Corp. (Sysco) (defendant) contracted with Consumers International, Inc. (CI) (plaintiff) to supply at least 80 percent of the food service products that CI distributed to its customers. The contract contained a termination at will clause that stated: “This agreement may be terminated . . . [b]y either party upon sixty (60) days prior written notice to the other party.” Sysco invoked this clause and gave CI 60 days notice of its intent to terminate the contract. Sysco did not offer a reason for its termination of the contract, but there was no evidence of bad faith. CI brought suit for wrongful termination of contract, claiming that the implied covenant of good faith and fair dealing required that any termination at will clause inherently required a showing of good cause. The trial court granted Sysco’s motion for summary judgment. CI appealed.
Rule of Law
Holding and Reasoning (Voss, J.)
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